The broad market may have recently made new highs, but scores of individual stocks have also hit new 52-week lows. There are a few that could be considered some of the best value stocks to buy.
Yes, blindly buying every value stock that hits a new low is not exactly a surefire strategy for long-term investing success. In many cases, value stocks that continue to make new lows are in the “value trap” category.
However, there are situations where the market has it all wrong and is overreacting to negative developments. While it may take time for such stocks to recover, those with the patience to wait for headwinds and hiccups to play out have the potential to see big gains in the event a rough patch gives way to a rebound.
Taking a look at U.S.-listed stocks that trade at or near their 52-week low and trade at a price-to-earnings (P/E) multiple of 15 or less, the following seven stand out as some of the best value stocks to buy right now.
Adecoagro (AGRO)
Adecoagro (NYSE:AGRO) is an agribusiness firm. The company owns and operates commercial farms in Argentina, Brazil and Uruguay. At current prices, shares trade at a super-cheap 5.5 times forward earnings. However, to most in the market, it’s not a mistake that investors have bid AGRO down to a heavily discounted valuation.
Why? With the recent weakness in sugar and ethanol prices, there is high uncertainty surrounding Adecoagro’s results in the near-term. That said, JPMorgan’s Lucas Ferriera recently upgraded AGRO stock from “underweight” to “netural.” He noted there may limited further downside for sugar and ethanol prices.
Furthermore, while it may take some time, supply-and-demand trends could normalize, sending both commodities back to higher prices. Ferreira remains conservative in his view on AGRO, giving the stock an $11.50 per share price target, but the long-term upside could be far more substantial. For instance, even a modest re-rating to a forward multiple in the high single-digits would mean a move for AGRO towards $15 per share. If you’re bullish on commodities and on the search for deep value opportunities, you may find it here with Adecoagro.
Bumble (BMBL)
Bumble (NASDAQ:BMBL) may have been a growth stock when it first went public in 2021, but a mix of severe price declines and a move to profitability have made this online dating play one of the top value stocks to buy.
At current prices, BMBL stock trades for just 10.5 times forward earnings. Admittedly, it’s not entirely surprising that Bumble sports a forward multiple one akin to that of a bank than a technology company. After all, Bumble’s larger competitor Match Group (NASDAQ:MTCH) trades at a similarly low valuation. Moreover, the market is bearish on online dating stocks on the view that they are waning in popularity.
However, as InvestorPlace’s Leo Miller pointed out earlier this month, Bumble continues to report solid revenue and paying user growth. Even if it fails to happen in a span of a quarter, if Bumble continues to disprove the bear case, a re-rating may be in store for this deeply undervalued stocks. If a rebound fails to happen, and BMBL remains in deep value territory, the company could become an activist target much like what is happening now with Match Group.
Bristol-Myers Squibb (BMY)
Certain big pharma stocks have seen a continual surge higher over the past year. Bristol-Myers Squibb (NYSE:BMY) has not been one of them. Instead of cashing in on a weight-loss or other “megablockbuster” drug, the pharmaceutical giant is instead contending with patent expirations, declining sales and big one-time losses that have skewed earnings for the present year.
However, the situation may get better for BMY stock far sooner than currently anticipated. Following the stock’s recent move to a new 52-week low, the market may have overly factored BMY’s issues into its valuation. The stock today trades for only 6.2 times estimated 2025 earnings. This valuation represents a discount to even other pharmas experiencing similar patent expiration issues. BMY also sports a high 5.66% forward dividend yield.
That’s not all. The company is targeting $1.5 billion in cost cutting measures. Alongside this, recent biotech acquisitions could help the company replenish its drug pipeline. If you are an investor with a multi-year time horizon, there may currently be the opportunity to buy BMY, collect its steady 5.66% dividend and wait for management’s turnaround efforts to result in stronger profitability and a stock price recovery.
Enel Chile (ENIC)
Enel Chile (NYSE:ENIC) is another of the U.S. listed international value stocks to buy. Shares in this Chile-based electric utility experienced a super surge during 2023. As I discussed at the time, this big rebound in price was due to improved weather conditions enabling Enel to get its hydroelectric power facilities back to full operation.
Over the past year, however, ENIC stock has experienced a moderate price decline. Falling by around 22.6% over the past twelve months, shares recently hit a new 52-week low. As Seeking Alpha commentator Valkyrie Trading Society pointed out in June, various perceived headwinds have driven this price decline. However, these headwinds could be countered by continued favorable hydrology conditions and a relatively less-burdensome regulatory environment.
With shares trading for only 6.4 times forward earnings, it may not take much in the way of positive earnings surprises or favorable macro and company-specific developments to drive a surge in ENIC back toward 2023 highs nearing $4 per share. Similar to BMY, this could end up being another “get paid while you wait” deep value situation. Based on payouts over the past 12 months, ENIC has an annual dividend yield of around 8.76%.
Nordic American Tankers (NAT)
Nordic American Tankers (NYSE:NAT) owns a global fleet of 20 Suezmax crude oil tankers. The recent Mideast conflict has been a boon for tanker companies, thanks to the positive impact geopolitical strife is having on charter rates. This has, of course, led to a spike in profitability.
In turn, it enabled the company to pay out cash dividends that give NAT stock a forward yield of 11.65%. That said, these boom times have not translated into a continued NAT rally. Rather, the stock has been rangebound for the past year. At current prices, shares trade for just 8.4 times forward earnings. Yes, with Suezmax charter rates trending lower for most of this year, there have been concerns that the latest wave of boom times for the tanker space is coming to an end.
Then again, maybe not. Recent charter market analysis suggests that these declines may be just seasonal in nature. The Red Sea crisis is intensifying once again, which may also lead to an unforeseen resurgence in tanker charter rates. With so much in play that could sustain NAT’s super-high yield or spark a rebound, buying in now near its 52-week low could prove profitable.
Posco Holdings (PKX)
South Korea-based Posco Holdings (NYSE:PKX) is primarily a steel manufacturer but the company owns other basic materials and industrial businesses. For investors looking for value stocks to buy that have hidden growth catalysts, one area that may pique your interest is Posco’s pivot towards becoming a “greener” company.
The steelmaker has long-term plans to eventually produce all of its steel using “green hydrogen.” Posco also continues to up the ante, with its efforts to become a leading provider of EV battery materials. The company has continued to increase its EV wager, even as demand for electric vehicles experienced a global slump. Declining excitement for Posco’s “green wave” catalysts, coupled with a continued slowdown in steel demand, has weighed heavily on PKX stock.
Shares are down 32.76% over the past year. However, Posco may be well-positioned for a recovery as macro headwinds normalize and the EV growth trend regains momentum. The stock today trades for only 7.8 times estimated 2025 earnings. If results meet or beat these expectations, PKX, now near its 52-week low of $65 per share, could bounce back towards its past high water mark of around $130 per share, double that of current prices.
Molson Coors (TAP)
This is the second time since May that I’ve called Molson Coors (NYSE:TAP) one of the top stocks to buy at a 52-week low. With this, you may assume that since shares in the brewing giant have continued getting cheaper this stock is a value trap to avoid.
However, even though the brewing giant’s shares have continued to decline, hitting new 52-week lows along the way, you may still not want to give up on TAP stock just yet. Shares, of course, remain dirt cheap at a valuation of just 9.5 times forward earnings. Even as forecasts still call for Molson Coors’ growth to remain sluggish, given that the company has been beating forecasts in recent quarters, it’s possible that results will at the very least be better than feared in the quarters ahead.
If this happens, and Molson Coors provides more promising updates to guidance, this could spark the beginning of a rebound for TAP shares. Alongside a low valuation, another appealing feature with Molson Coor shares is the stock’s 3.32% forward dividend yield. The company has also been aggressively buying back shares, another means of returning capital to shareholders.
On the date of publication, Thomas Niel did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.comPublishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.